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M2 buyout of Eftel inches closer

ISP's shareholders vote yes.

Eftel looks set to be integrated into the business of listed telco M2 Telecommunications after 90 percent of the company’s shareholders today indicated they would accept the deal.

M2 first made a play for the internet service provider in March, valuing the company at $44.1 million with the offer price at $0.35 per share.

The bid was part of a pair of plays M2 made at both Eftel and ISP Dodo. M2 valued Dodo at $203.9 million.

Five of Eftel's board members, also shareholders, today gave instructions to accept the M2 offer.

Chairman Stephe Wilks told iTnews there was very little now that would stop the deal going through.

"There were some technical things set out, conditions like a 90 percent threshold, no material adverse change and no prescribed occurances, like the company disappearing,” he said. “I don’t think there’s much that would change it now."

He said the deal price remained the same, with the time frame for completion set for June or earlier. Wilks said he expected there would be no material change to the business.

“We’re doing a bit of joint work to work out how to put the companies together. Broadly they love the business and where it has gone, I think there’ll be quite a big part of the organisation staying the same," he said.

"It’s hard to predict. But the board will be gone, because you don’t need two boards, and I would I expect I will sail off into the sunset, because you don’t need two chairmen.”

Wilks said he would consider remaining in the telco sector but would immediately focus on the opportunities in the start-up sector.

Melbourne-based M2 has been on an acquisition blitz in recent years, most recently taking over Primus Telecom Australia for $192.4 million last year, and Unitel and People Telecom in 2008.

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